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00:00CAROLINE: I'M JOINED BY GINNI ROMETTY. YOU'VE JUST BEEN ON STAGE. WE HAVE 20,000 CUSTOMERS, PARTNERS HERE. ENGINEERS, DEVELOPERS. THEY ARE ALL HERE ABOUT THE CLOUD. WHAT SETS YOU ARE CLOUD APART FROM THE COMPETITION? MARC: 20,000 -- GINNI: 20,000 IS EIGHT JAMPACKED NUMBER -- IS A JAMPACKED NUMBER. THE IBM CLOUD IS A PLATFORM FOR NEW BUSINESS. THERE'S THREE THINGS THAT DISTINGUISH IT. ONE, IT IS ENTERPRISE STRONG. IT IS ENTERPRISE STRONG AND YOU HAVE TO PREPARE THEM FOR THE FUTURE AND THERE'S TWO MORE THINGS ABOUT OUR CLOUD. IT IS A DATA FIRST ARCHITECTURE AND IT IS COGNITIVE AND ITS CORE. -- AT ITS CORE. THERE'S THE GLOBAL THIS AND YOU HAVE TO BE ABLE TO PACK INNOVATION IN ALL THE TIME THROUGH THE PIPELINE. WE ANNOUNCED BLOCKCHAIN IN PRODUCTION ON THE IBM CLOUD. 10,000 TRANSACTIONS PER SECOND. WHAT WE ARE DOING WITH WALMART AND ALL THE BANKS. WE ALSO ANNOUNCED QUANTUM, WE ARE THE FIRST QUANTUM COMPUTER AVAILABLE ON THE CLOUD. YOU CANNOT DO THIS ON YOUR PREMISES. WITH ENTERPRISE STRONG, YOU HAVE TO HAVE SECURITY THAT IS BETTER THAN ANYONE ELSE AND A PRESENCE AROUND THE WORLD. WHEN IT COMES TO DATA FIRST, IT'S VERY DIFFERENT FROM THE OTHER CLOUDS OUT THERE. YOU HAVE TO BE ABLE TO PROTECT THE CLIENT'S INSIGHTS AND NOT DISTRIBUTION THEM. -- DISTRIBUTE THEM. THEY TAKE DATA AND IT'S HOW THEY MONETIZE IT INSIDE DISTRIBUTE IN IT. -- DISTRIBUTING IT. WE CAN GIVE THEM DATA CONTROL AND TELL THEM FOR SURE THAT DATA IS NOT INTERMINGLED WITH SOMEONE ELSE'S. THE INSIGHTS FROM IT WERE NOT MONETIZED. THEY ARE YOURS. THE THIRD PART THAT THIS THING WISHES US IS THIS IDEA THAT IT IS COGNITIVE AT THE COURT. WHAT IS DIFFERENT ABOUT WATSON, AI IS A SMALL PIECE OF IT. IT IS TRAINED IN INDUSTRY AND DOMAIN. OF ALL THE DATA IN THE WORLD, 80% OF IT IS NOT SEARCHABLE. 20% OF THE WORLD'S DATA IS ON THE INTERNET. THAT IS WHERE THE GREATEST VALUE IS AND THAT IS WHAT WATSON HAS BEEN TRAINED TO DEAL WITH. EVERYONE WILL BE CONFIDENT OF. -- COGNITIVE. CAROLINE: WHERE ARE YOU WINNING? MARC: TODAY, I WAS -- GINNI: TODAY, I WAS JOINED BY THE CEO OF AT&T. AND H&R BLOCK. WATSON IS DOING YOUR TAX RETURNS. GUEST PREPARES DOING TENS OF MILLIONS OF TAX RETURNS OUT THERE. SALESFORCE -- WE ARE PUTTING SALESFORCE -- WATSON BEHIND SALESFORCE.COM. CAROLINE: YOU HAVE SERVICES IN AUSTRALIA. YOU INVEST WINTER THAT YOUR CLOUD IS AVAILABLE GLOBALLY? GINNI: WE ARE 50 DIFFERENT DATA CLOUD CENTERS AROUND THE WORLD. AS OF LAST NIGHT, 20 COUNTRIES. WE ANNOUNCED A NEW PARTNERSHIP IN CHINA. THIS IS THE BEST ENTERPRISE STRONG CLOUT IN THE WORLD. -- CLOUD IN THE WORLD. EVERYONE WILL CONNECT CLOUDS TOGETHER. PART OF BEING ENTERPRISE STRONG AS BEING HYBRID. YOU CAN CONNECT CLOUDS A CLOUD OR CLOUT TO PRIVATE -- CLOUD TO PRIVATE. YOU WANT TO SHARE DATA AND APPLICATIONS ACROSS ALL THESE THINGS AND THAT IS WHAT WE DO. CAROLINE: CLOUD AT THE MOMENT IS 17% OF YOUR REVENUE. WHERE DO YOU WANT IT TO BE? GINNI: WE SEE LOTS OF OUR CLIENTS MOVING THEIR BUSINESSES ONTO THE IBM CLOUD. WE DO 97% OF THE LARGEST BANKS IN THE WORLD. WE RUN 80% OF THE AIRLINES. YOU TAKE A LOOK AT ALL THE TELCOS, 90% OF THE TELCOS, 90% OF THE CREDIT CARD TRANSACTIONS COME THROUGH US. THE IBM CLOUD IS ABOUT HELPING THEM COME INTO THE FUTURE WORLD. YOU SEE THAT IN OUR GLOBAL TECHNOLOGY SERVICES BUSINESS. MANY PEOPLE SAID THAT BUSINESS IS RUNNING SERVICES FOR OTHER PEOPLE AND IT WOULD GO DOWN. IT HAS NOT. IT HAS BEEN GROWING AND IT HAS A HEART TO THAT WHICH IS THEN DOING CLOUD. THEY WILL BUILD MANY NEW THINGS ON THE CLOUD. HAVE REGIONS THEY KEEP OTHER INFORMATION -- THEY HAVE MADE INVESTMENTS IN DATA. WE HAVE TO THE HYBRID CLOUD ENVIRONMENT AND THE SUCCESS OF THE CLOUD. CAROLINE: WILL THE REVENUE YOU ARE GARNERING THE CLOUD EXCEED -- GINNI: YOU MENTIONED 70%. $13.7 BILLION, GROWING 35%. OUR CLOUD, OUR ANALYTICS REVENUE , WATSON, MOBILITY SECURITY, THAT IS WHAT WE CALL STRATEGIC IMPERATIVES. THAT HAS BEEN GROWING AT 14% LAST YEAR, $33 BILLION. 41% OF IBM. COMPLEMENT IT BY THE WORLD OF FRANCHISES. THOSE ARE REALLY IMPORTANT BUSINESSES. TOGETHER, WE ARE GROWING IN THE PLACES WE ARE INVESTING TO GROW AND THOSE OTHER AREAS WE ARE MOVING WITH THE MARKET HERE. CAROLINE: CHINA WAS FASCINATING. YOU JUST GOT BACK YESTERDAY. TALK TO ME ABOUT THE PARTNERSHIP . YOU ALWAYS HAVE TO BE A PARTNER WITH SOMEONE IN CHINA? GINNI: WE WILL BE A PARTNER IN THE CLOUD, BUT WE HAVE MANY BUSINESSES IN CHINA. WE WERE ONE OF THE VERY FIRST, WE'VE BEEN THERE OVER 35 YEARS. VERY WELL ESTABLISHED, VERY WELL-RESPECTED BRAND. WE ARE PARTNERS WITH THE BANKS THERE. THEY ARE SOME OF THE MOST SOPHISTICATED FINANCIAL OPERATIONS IN THE WORLD AND REQUIRE VALUES THAT ARE UNBELIEVABLE TO MANAGE. WE WILL PARTNER. WANDA IS ONE OF THE MOST SUCCESSFUL PRIVATE COMPANIES IN CHINA. GREAT ATTITUDE ABOUT AGILITY AND SCALE AND WANTING TO MOVE FORWARD. THEY HAVE A HUGE BUSINESS THAT WILL ALSO BE ON THIS CLOUD. IT WILL BE A CUSTOMER OF THE CLOUD AND A PARTNER IN THE CLOUD. IT WILL BE A GREAT FOOTING BECAUSE THEY HAVE A BIG ECOSYSTEM IN ADDITION TO THE CLIENTS IBM HAS. THOSE COMING TOGETHER. I LOOK FORWARD TO THAT BEING A SUCCESSFUL PARTNERSHIP THERE. CAROLINE: DO YOU HAVE A VIEW ON HOW BIG YOU WANT CHINA TO BE IN TERMS OF YOUR REVENUE STREAM? GINNI: IT IS AN IMPORTANT PART. ABOUT CHINA, YOU SEE TWO MODELS THERE. THE LARGEST STATE OWNED ENTERPRISES OR JUST LARGE ENTERPRISES AND TRYING TO EMPOWER ENTREPRENEURIAL SEGMENTS. YOU DO NEED TO LOOK AT THOSE TWO MARKETS DIFFERENTLY AND SUPPORT THEM BOTH. WE WERE CERTAINLY STRONG IN THE ENTERPRISE MARKET AND NOW, WE SERVED THEM WITH THE CLOUD AND SUIT THE ENTREPRENEURIAL MARKET -- SERVE THE ENTREPRENEURIAL MARKET. CAROLINE: COMPARING IT TO THE U.S. TECH PATTERN, YOU HAVE PHENOMENAL PLANS. GINNI: THIS TOPIC ABOUT TALENT -- ANY COUNTRY I GO IN, WE HAVE THIS DISCUSSION. IT IS THE MAIN CONCERN. THE WORKFORCE IN FRONT OF US MEANS A DIFFERENT SET OF SKILLS. WE ARE TALKING ABOUT HERE IN THE UNITED STATES HOW TO BUILD THESE KINDS OF SKILLS. THEY ARE NEW COLLAR SKILLS. YOU HAVE TO HAVE A CURRICULUM IN TECHNOLOGY FOR ALMOST ANY JOB. CHINA HAS THAT CHALLENGE AS WELL AS EVERY COUNTRY IN THIS WORLD. WHETHER IT IS GERMANY OR THE UNITED STATES, BUILDING THIS NEW SET OF SKILLS. THAT IS SOMETHING WE BEEN REALLY FOCUSED ON, SOMETHING WE STARTED MANY YEARS AGO WITH PATHWAY TO TECHNOLOGY SCHOOL. THESE ARE PUBLIC HIGH SCHOOLS IN CONJUNCTION WITH THE COMMUNITY COLLEGE. THEY TURN IT INTO A SECURE HIGH SCHOOL WITH A CURRICULUM THAT BUSINESSES WILL HIRE FROM. -- SIX YEAR HIGH SCHOOL. THEY ARE EMPLOYABLE. GRASSROOTS, VIRAL. WE HAVE 300 OTHER COMPANIES TO COME IN WITH US. WHAT WE DO AS A COMPANY, WE GIVE A CURRICULUM AND THEN WE PROVIDE MENTORS. ALL OF OUR EMPLOYERS ARE HAPPY TO MENTOR THESE KIDS. THERE ARE 40,000 KIDS AND I'VE ALREADY HIRED HUNDREDS OF MY OWN. THIS IS A MODEL THAT IS SCALABLE ACROSS THE WORLD. CAROLINE: IS THE ADMINISTRATION HELPING? GINNI: THE CURRENT ADMINISTRATION UNDERSTANDS AND SEES THIS WORKFORCE DEVELOP AND AS AN IMPORTANT THING. I'M VERY PLEASED WITH THE FOCUS THEY ARE PUTTING ON THIS AND IT WILL GIVE US A CHANCE TO SCALE SCHOOLS LIKE THIS AND OTHER MODELS. WE CAN SCALE THEM THROUGH A PUBLIC-PRIVATE PARTNERSHIP AND WE HAVE TO WORK ON APPRENTICESHIP AND

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IBM CEO Rometty on Growing Cloud Business, U.S. Workforce

Ginni Rometty, IBM's chief executive officer, sits down with Bloomberg's Caroline Hyde at IBM InterConnect 2017 to discuss IBM's growing cloud business, opportunities in China and the changing U.S. workforce. (Source: Bloomberg)

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